Open for Business tackles top digital transformation trends in 2019

Digital transformation thought and action leader Rey Lugtu, President and CEO of Hungry Workhorse, guests in OPEN FOR BUSINESS anchored by Caesar Vallejos.

“Digital transformation is not about technology, but it’s about building capabilities and competencies in a strategic way.”

In the 27th episode of Eagle Broadcasting Corporation’s online business show “Open for Business,” Reynaldo Lugtu, President and CEO of Hungry Workhorse emphasized that ‘digital transformation is not only a concept, it is a reality but it is also a journey that you take as an owner of a company or a startup.’

Lugtu, one of the country’s most sought-after trainers/speakers and a digital transformation thought and action leader, described 2018 as a period where ‘many of the large companies are looking at culture and mindset transformation.’ In the previous years, he mentioned that organizations ‘started to look into digital transformation using technology as the driver but again they discovered along the way that it’s not easy and that you need to change people’s mindsets and culture.’

“You have to be cognizant of how to maximize the benefits from digital transformation.  Again, it’s not about technology.”  Lugtu, said.  However, he advised entrepreneurs to ‘take advantage of emerging technologies out there’.

Biggest barrier

He cited a Gartner study that while many companies are undergoing digital transformation, they are ‘discovering that it’s not easy and the biggest barrier is culture and mindset of the people inside the organization.’

“It’s a difficult process and in our consulting work now, we have developed a number of methodologies to change the behavior of employees by doing some intervention in the organization,” Lugtu said.

He stressed that changing the culture and mindset of an organization must emanate from the CEO that must be supported by a number of activities.

“One of them are intervention activities that include high velocity feedback and learning, applying the concepts of agility and sprint in feedback mechanisms. We also applied team learning concepts to change behavior of employees and a number of methods to reward employees when they change,” he said. Lugtu observed that CEOs are now taking the reins in digital transformation in the Philippines. “So by next year and beyond, many of the CEOs will ‘own’ digital transformation,” he emphasized.

Cloud:  a big boost

Cloud is a big a boost in the digital transformation space.  “Now there’s a deluge of many applications, from ERP to core banking to human resource applications.   Before, it was all capex-driven. Today, he said that cloud is becoming more cost efficient, and organizations will become more productive and efficient in the use of technology because cloud is enabling cheaper and inexpensive applications for any organization to use to improve their efficiency, operations and so on,” he noted.

“The problem with many business owners, especially with SMEs, is that they think technology is expensive. Because of cloud, a lot of the applications have become so inexpensive.  This includes subscription-based applications and a number of resurging ones can be engaged based on performance instead of a fix subscription,” he noted.

Chatbots and tech drivers

“This year we saw some companies trying chatbots but next year, there’s going to be a widescale adoption,” Lugtu predicted.

This will be used in different applications primarily on customer service ‘but chatbots will also help in business intelligence.’

“The acceptance of chatbots amongst millennials and Gen Z, according to the latest study is 80% globally, so imagine that kind of openness to interacting with a chatbot or bot in general.”

Lugtu mentioned that millennials and Gen Z will drive the adoption of many of the new technologies.  “While both segments are digitally adept, the millennials and Gen Zs are different in the ways of consuming. Gen Zs are reportedly more conscious with the environment and they want to save the planet while the millennials want to live in the now, they travel a lot,” he noted.

Harshest penalty
Lugtu mentioned that in 2019, many companies will hurriedly comply to the Data Privacy Act because the ‘National Privacy Commission will start to track and monitor organizations especially big and medium ones.’

“This will change how the companies design their customer and consumer experiences, so many of the consumer experiences will now involve data privacy clauses, accepting or giving away your data or not giving it away so that’s going to happen now because we saw also a widespread awareness of data privacy amongst consumers. If you ask most consumers, they are aware of their data privacy,” Lugtu explained.

Lugtu said that the Philippines has the harshest penalties in data privacy in the world.

“In the rest of Europe there’s penalties, but in our country, the penalty is imprisonment of the CEO or the data protection officer. That’s why companies now are hurrying to become more compliant.  If you look at conglomerates in the country, they are now aware and conscious of sharing information to their sister companies, we never saw that in the previous years,” he observed.

However, Lugtu predicts a  slow down to activities related to customer experience because ‘there’s going to be learning happening in a lot of organizations. They will thread on a path that they have not stepped on in the past so that they will be careful and cautious in launching new consumer programs because they will be aware of this data privacy.’

 CX to take center stage

Nevertheless, customer experience will take on center stage in the coming years. “Consumers are becoming more demanding with the resurgence of millennials and Gen Z.  To support that, there will be a number of new applications that will come and I am seeing a lot of a lightweight, inexpensive CRM systems in the cloud. We are seeing lightweight e-commerce platforms which you can deploy fast, faster than before.”

“As technology becomes less expensive, many of the organizations in the Philippines will start adopting these new platforms and new hardware for that matter so companies will try new things like new digital displays where customers react and interact without any human intervention,” he said.

This will necessitate companies to mine data and analyze data so that they can continuously improve on customer experience.

Lugtu also made his forecasts on blockchain and the future of startups in the Philippines.  He cited to a methodology in pursuing target segments of the market and aligning them in the design of the best customer experience.

For the details of his predictions and other trends in 2019, check out this link.  It can also be viewed on

(Eagle News Service)